In economics, firms are assumed to
A)maximize output prices.
B)minimize output prices.
C)maximize profits.
D)maximize consumer surplus.
E)maximize customer satisfaction.

Question

Quizplus · Accepted Answer

Firms in economics are assumed to maximize profits, which means they seek to produce and sell goods and services in a way that generates the greatest difference between revenues and costs. This assumption is based on the idea that firms operate in competitive markets and face pressure to increase efficiency and reduce costs in order to remain competitive.

In Economics, Firms Are Assumed to